Dunkin Donuts IPO

July 28, 2011 by staff 

Dunkin Donuts IPODunkin Donuts IPO, Investors were love Dunkin ‘Donuts stock on Wednesday to New England love Dunkin’ coffee and churros and Munchkins. After initially set to sell and for 16 to 18 and one hand, strong investor demand led to investment bankers priced brands Dunkin (symbol: DNKN) in shares and 19. At the end of the first day of trading, which rose nearly 47 percent, to 27.85, and giving the company 61 years ago who was born in Southern Artery in Quincy market capitalization of approximately to 3.5 billion.

Added to a summer of sizzling IPO values. “Investors are hungry for new kind of history that growth, and Dunkin ‘, I think is one of the best out there,”said financialanlyst Kimberly Harris, a registered representative with Armstrong Advisory Group in Needham, Mass. While positive about the future of Dunkin, Harris warns that a major factor behind its IPO of 47 percent are private owners of Dunkin up capital does not offer much credit – only 18 percent of the total number of shares. “I think we’re seeing a bit of a premium right now … because there are not many out there who shares” and the mismatch between supply and demand led to price jumps.

In its last fiscal year, Dunkin and had revenue of 577.1 million and operating income of 193.5 million y. Because carrying a debt load of nearly 1.8 billion in March, about 75 percent of Dunkin’s operating income goes to pay interest. The business consists of about 76 percent of Dunkin ‘Donuts, 24 percent of Baskin-Robbins franchise with 16,000 locations in 57 countries. Dunkin ‘plans to add 200 250 new U.S. locations this year, perhaps 500 in 2012. And long term, there is talk of doubling its U.S. footprint in the next two decades.

Much of this expansion is likely to be in the Midwest, South and West. Here in New England, if sometimes I think there is a Dunkin ‘Donuts on every corner, not bad: there is a Dunkin’ Donuts outlet for every 9,700 people in New England and New York. The rest of the eastern U.S., one for every 48,400 people, driven largely by means of Dunkin ‘in Chicago, Philadelphia and South Florida. In the West, is not equivalent to only 1 out Dudo by 1.2 million people, with just six dozen franchises in the region west of the Mississippi River.

Gregory J. Pinto, chief investment officer at Baystate Wealth Management in Boston, thinks chasing investors after the IPO shares can be a little overcaffeinated.

“We have to wait and evaluate the approach,”said Pinto. Given that the price-earnings ratio Dunkin is out of line with similar companies, Pinto said:” We want to be a little cautious, who want to sit and evaluate this people look at one month, two months from now and see if it makes sense to own shares … what we are telling our clients is to be a bit careful to see how the company has a deeper look into the sales to take a deeper look at some of the numbers.”

Harris said New England, in particular, should look in the archives of Dunkin ‘with healthy control before investing. “Some people are so sure of a company that is on the street every day.’s A great story here in New England. That does not necessarily translate into the rest of the country and around the world, so that careful with that.”

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